The Top 3 Mistakes Consultants Make

I received a question from an HR pro via the SHRM Connect site. They are considering going out on their own and wanted to know about the biggest mistakes consultants make.

Some days, it’s hard to believe I’ve been consulting for almost 13 years. One of the things I did before going out on my own was talk to other consultants. I bought them breakfast, lunch, dinner, coffee, etc. and asked them about their successes and mistakes. I learned that consulting mistakes can fall into three categories: the consultant, the money and the lifestyle.

Mistakes Consultants Make #1 – The Consultant

It’s important to realize that declaring yourself a consultant can present its own set of challenges. First off, some people will view your transition to consultant as temporary – “until you get a real job”. After enough time has passed, they will realize that consulting is your real job. Be patient.

As a consultant, your credibility and integrity are everything. Consultants need to be true to their own point of view. If a client wants you to deliver a message on behalf of the organization, you have to make sure you genuinely agree with the message. In addition, if a client asks you to solve a specific problem, make sure you concur that it’s a problem (and not a symptom). Otherwise, your solution will not work and your credibility gets dinged. Clients have been known to misdiagnose their problems – not intentionally, but sometimes they are too close to the issue. That’s why you’re there.

Not only is managing your credibility essential, but the quality of your results must be outstanding. Consultants need to be prepared, follow-up and meet deadlines. Clients pay a lot of money for your service, and they expect nothing short of perfection.

Speaking of clients, consultants must remember not to get too dependent upon one client. As tempting as it might be to get a sweet gig that’s 30-40 hours per week with a great rate, it’s easy to get deeply entrenched with one project and not worry about networking to build some additional clients. Then that day comes along and the “sweet gig” comes to an end – often abruptly.

It’s equally important for consultants to make investments in themselves. Take time to attend conferences, classes, etc. even if it means leaving some billable time on the table. Clients want to know they are hiring the best. Developing yourself and building new skills gives clients confidence in your ability to develop relevant solutions.

So, becoming a consultant requires credibility, integrity, timely and perfect results. While we have a lot of responsibility, we can never get lulled into thinking that we’re smarter than our clients. We do, however, need to be skilled at operating within a client’s corporate culture and value working relationships and office politics when engaged on a project.

Mistakes Consultants Make #2 – The Money

I’ve always said consulting is not about the money. Well, let me make one caveat – consultants have to learn how to properly price their services. That is about the money. If you don’t learn how to charge correctly, your consulting career will be short-lived.

On the expense side, it might not look like it but it takes a tremendous amount of money to run a consulting business, even when it’s out of your home: liability insurances, accounting / attorney fees, computer equipment and software, salaries, health insurance, etc. It’s true you will realize a savings in some areas, but increases in others.

Money management can potentially be a challenge because you don’t have the steady income a regular paycheck provides. One minute your checking account has $15K and the next it has $1K. It’s easy to develop poor spending habits because the money is so erratic. Consultants have to learn how to budget and plan.

Mistakes Consultants Make #3 – The Lifestyle

Most people enter consulting to get flexibility in their lives. And it’s true, there’s a lot of flexibility. But it takes a lot of energy to maintain balance. Because you have so much flexibility, it’s tempting to work all day, every day.

And the reality is, consulting can be a lonely occupation. You don’t spend every day all day with people. That’s not to say you won’t be busy. You will have clients who expect you to be on call 24/7/365. No kidding – I know a consultant who said his business partner was once called out of the shower to answer a question.

You can also consume a lot of time traveling. Some people love travel. Others hate it, especially if you have kids or family obligations that prevent you from spending time at home.

Bottom line: Consulting can be a fabulous occupation. In my consulting work, I have terrific clients and work on interesting projects. I couldn’t ask for better. But consulting requires a disciplined balance of marketing, administration, finance, project management AND client service. All of which must be executed perfectly in less time than required.

When I started consulting, I expected to get pushback from my friends who were already consultants. They said, “Welcome to the club. There’s room in the sandbox for everyone.” Over the years, I’ve learned that a good consultant will tell you the upsides to consulting; a great consultant will tell you the pitfalls as well.

For my consulting colleagues, what do you think? What are the biggest mistakes consultants make? Share your expertise in the comments.

Reader Interactions

Comments

I’m 9 months into consulting. This article is so spot on on so many fronts! By the way, there are awesome clients who treat you with professionalism and mutual respect and there are clients who just view you as a vendor or sale person and treat you at their whims and fancies. Keep calm and it takes a lot of patience and humility to show your value now that you are not on the ‘buy’ side.

Great article. After 16 years as an independent consultant, two other key lessons learned is that you need to remember are:
– When you’re delivering services, make sure you continue to market and sell. You are not always on the top of every prospective client’s mind. You need to make sure you stay on people’s radar screens. I’ve found providing ongoing value and content through newsletters, blogs, and personal notes to be very effective. I can’t tell you the number of times someone I haven’t spoken with in years reaches out to me about a potential project the day after they receive by e-newsletter, blog, etc.
– Make sure you are diversifying your client base. Relying too heavily on one client is very painful when they no longer need you to the extent they’ve been working with you in the past. Suddenly you’re scrambling to fill the void. And in my experience, the type of work we do is a long sales cycle.

@ES – Thanks for sharing. I know many HR pros who have found moving to the other side of the table to be very insightful. Personally, I don’t draw the distinction between practitioner and consultant. We all do a bit of both. The difference is the number of companies that are involved. 😉

@Edith – Spot on! When I was interviewing consultants, I heard both of these stories. It’s so easy to stop marketing when you’re super busy. As consultants, we have to understand our typical sales cycle and market all the time. A consultant once told me, “Don’t panic. The work never all comes in at the same time.” I must admit…it’s come pretty darn close at times. LOL!

Thank you for the advice here! My husband told me last night that he’s interested in becoming a business consultant, and I’m all sorts of nervous about it. Today is my research day, to make a game plan and document lots of advice.

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Hi! I'm Sharlyn Lauby, an HR pro turned consultant. I created the HR Bartender blog so people would have a friendly place to discuss workplace issues. And since, over the years, I've developed an appreciation for the culinary arts (translation: I'm a foodie) you'll see some of that here, too. So pull up a stool and order your favorite drink... the bar is always open.